The 2 Most Important Questions Advisors Should Ask Clients

William Coppel of First Clearing tells ThinkAdvisor that advisors typically ask clients “a list of 55 questions” but need to boil that down

Full-service FAs need to go beyond financial aptitude, Coppel says. Full-service FAs need to go beyond financial aptitude, Coppel says.

“The brand of full-service investment advice the industry has historically delivered is under attack,” states a white paper, “Digital Disruption: Is the Financial Advisor’s Value Under Siege?” released by Wells Fargo Clearing Services’ First Clearing last fall.

Alarming, perhaps; but the situation presents a chance to show high-net-worth clients how much they need human advisors: Deliver value that algorithms simply can’t, says William Coppel, managing director-chief client growth officer of First Clearing, in an interview.

“Advice goes beyond a portfolio of ETFs,” stresses Coppel, who spearheaded a program, available to First Clearing clients, that focuses on end clients’ well-being. The holistic approach aims to discover much more than just the amount of their investable assets.

Coppel calls a focus on client well-being the new advisor value proposition. It is designed to help clients enjoy a more fulfilling life, and, at the same time, can lead to FAs’ managing more client assets.

The strategy builds on Wells Fargo’s Envision financial planning process but takes an even deeper dive to better understand what clients are saving for when they set specific dollar goals.

To compete with digital advice, full-service FAs need to go beyond financial aptitude to develop interpersonal skills enabling them to better know just where clients and their families are coming from. As yet, no robo can do that, notes Coppel, a financial advisor early in his career.

To draw out clients, FAs, first and foremost, must ask effective open-ended questions about their lives and concerns.

In the interview, Coppel discusses the two most important questions an FA should ask.

ThinkAdvisor recently interviewed the clearing executive, on the phone from St. Louis, Missouri, headquarters. Prior to First Clearing, Coppel was with Quick & Reilly for 25 years. He contends that if advisors don’t adapt to and adopt industry changes propelled by advanced technology, they will simply become obsolete. Here are excerpts from our conversation:

THINKADVISOR: Why is focusing on client well-being so important for financial advisors?

WILLIAM COPPEL: The role of an advisor is to help families achieve well-being. That goes far beyond their money. It’s not about rates of return or risk tolerance.

Why is now the right time to zero in on well-being?

There’s an opportunity that FAs can capitalize on: There are a lot of nervous people out there struggling to make tough decisions. A good, sound partner that can help them think through and navigate challenging complex and emotional situations is valuable.

Your white paper says that advisors should ask clients better questions beyond the usual ones and that this will help them through the process that answers those questions. What are examples?

The two most important questions an advisor can ask are, first, “Tell me about yourself.” The client will begin to tell that story. When they pause, the next question is: “Tell me more about that.” We’re typically an industry of a list of 55 questions: Check the boxes, fill in this or that. We’re now saying, “Let’s take it a step further and go deeper. Given the opportunity, people are very happy to share information if they believe they’re in a safe environment and that it’s beneficial to the relationship. Humans find value in communicating [verbally], which you can’t achieve through a digital relationship.

What else can’t robo-advisors do at this state of development?

Computers can’t create emotional connections, and they can’t provide insight, which, in this situation, is about things that will have an effect on people’s finances. Sharing information goes beyond what’s on the balance sheet. It’s about: Tell me what’s important to you. Tell me about your life.

You’ve suggested that advisors work up a client “Wellness Profile.” What’s that?

It shows where clients are physically and emotionally. It helps FAs think more holistically about what will fulfill the client. There’s also a Network Profile, which is about how clients relate to their family — vertically, between generations — and to friends, colleagues and the community.

Why is it critical for FAs to know so much about a client’s family?

Without fully understanding the components of the families you serve, you can’t provide insight. But if you understand a client’s family, you can help them make better decisions around how they want to eventually allocate the assets in their portfolio.

What’s an example of how advisors can help clients once they have their Wellness Profile?

One of the challenges retired folks age 65 and older face is the cost of health care. Advisors can help them modify their lifestyle in ways that may reduce the [chances] of age-related disabilities and diseases. So, if you can cut [health care] costs in half, that’s a substantial amount of money for most people in retirement.

How do advisors who feel uncomfortable asking lots of questions, especially personal ones, get the knack?

That’s the same question farmers who lost their jobs to automation asked: “How do we acquire the skills to work in a factory?” The reality is that people have got to adopt and adapt to change. FAs will glean an enormous amount of information if they train themselves to be better listeners and better at formulating questions.

But thinking up questions and digging deeper take time away from the advisor’s main work. Doesn’t that present an economic challenge?

Advisors who are getting comfortable doing this are developing deeper relationships with the families they serve. They’re ending up with bigger relationships. They’re managing more assets but with fewer relationships and are able to penetrate more generations. An advisor’s success will never be measured by the number of relationships they have. It’s measured by the amount of assets they manage.

Does focusing on client well-being drive client loyalty?

Yes. The more you interact with an individual or organization, the greater the trust bond. As that bond grows, loyalty increases. But keep in mind that loyalty can retreat easily. So you need to continue to work on it, just like your practice. If you do something that’s inappropriate, loyalty will evaporate instantly.

Has there been skepticism or resistance from advisors about following this strategy?

A change in behavior is very difficult for people to embrace emotionally: “I’ve been doing it this way for a long time. It’s worked, and will work up till the day it doesn’t.” But if that’s your thinking, you become obsolete, just like the farmers who got pushed off the farms because of agricultural automation. So you have to be much more nimble and innovative, and address how you can do more or reshape what you once called your value promise.

In light of digital advice’s growing popularity, what will happen to full-service advisors who don’t strive for deeper client relationships?

Typically, people who don’t adopt, adapt, change or evolve with changing times find themselves on the outside looking in. Robo’s came out with a blast. And while they’ve been somewhat successful, they have a very small portion of overall assets. So they, too, have recognized that there’s got to be a balance between technology and human interaction.

What’s the upshot, then?

Smaller investors will benefit from automation, but you’re beginning to see many players in the robo world adding the human element. However, when you get above a certain level of assets and income, people find value in an intermediary.

What if veteran advisors insist, “I don’t want to adopt and adapt”?

It’s all a question of whether you want to change and are curious and have a desire to continue to provide value in your profession. I fully reject the notion: “I’m old, and I can’t change.”

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